India Inc is eyeing a demand push from Budget 2021-22, along with an increased outlay for infrastructure and social sector projects, according to a private survey.
The budget should also continue with the Centre’s policy focus on strengthening the manufacturing sector while promoting research and development (R&D) and incentivising new technologies, said the Federation of Indian Chambers of Commerce and Industry (FICCI)-Dhruva pre-budget survey released on Wednesday.
“The budget must prioritise growth-oriented measures over fiscal considerations. It must focus on employment generation and on putting more money in the hands of consumers – the twin engines that will boost demand and drive growth,” said Uday Shankar, president of FICCI.
About 80% of survey participants felt the key policy thrust of the government should be on the manufacturing sector while 61% pushed for improvements in the ease of doing business to strengthen the sector.
“Improving the ease of doing business, including ease of administration of the tax regime, are the key asks of the industry to promote India as a global manufacturing hub,” said Dinesh Kanabar, CEO of Dhruva Advisors.
As for boosting goods and services tax (GST) revenue, about 90% of the survey participants said that enhancing economic activity through greater consumption and investment demand should be the government’s focus.
This objective could be achieved through tax incentives aimed at personal tax relief, according to 40% of the participants while 47% said a widening of tax slabs would be the ideal measure to boost demand.
Further, 75% of those surveyed said that tax incentives could be used to boost employment generation.
In terms of challenges being faced by businesses, 52% respondents said timely receipt of refunds was a major issue while 61% called for a specific time frame for tax refunds to revive businesses.
